Oil and gas company Whitecap Resources Inc. dipped after it said on Monday it will acquire Kicking Horse Oil & Gas Ltd, a privately-held indirect subsidiary of Quantum Energy Partners, for $300-million in a stock-and-cash deal.
Canada’s oil and gas sector had a record start to 2021 in terms of mergers and acquisitions as companies took advantage of improved expectations of oil prices amid the pandemic recovery, and many industry participants expect the trend to continue.
Whitecap’s indirect acquisition of Kicking Horse consists of 34.5 million Whitecap common shares and $56-million in cash, along with the assumption of net debt estimated at $54-million as of Feb. 28.
The Kicking Horse assets are positioned in the liquids-rich portion of the Alberta Montney. Whitecap says the deal complements its existing Montney position at Karr and has significant offsetting activity.
Kicking Horse’s current production is about 8,000 barrels of oil equivalent per day (boepd) and is expected to increase to and maintained at 18,000–19,000 boepd over the next 12–15 months with the drilling of eight to ten wells per year.